Standard Pacific Corp. Announces Completion of $675 Million Senior Notes Offering, Tender Offer and $187.5 Million Equity Issuance

IRVINE, Calif., Dec. 22, 2010 /PRNewswire-FirstCall/ -- Standard Pacific Corp. (NYSE: SPF) today announced the completion of its $675 million senior notes offering, tender offer and the $187.5 million cash exercise of the warrant to purchase 89.4 million shares of Company common stock held by MP CA Homes LLC.  

Senior Notes Offering and Debt Repayments

As previously announced, the senior notes offering included the private placement of an aggregate principal amount of $275 million of the Company's 8 3/8% senior notes due May 2018 and $400 million of its 8 3/8% senior notes due January 2021.  In connection with the financing, the Company repurchased $60.5 million, $145.0 million, and $145.2 million aggregate principal amount of its 9 1/4% senior subordinated notes due April 2012, 6 1/4% senior notes due April 2014, and 7% senior notes due August 2015.  In addition, the Company repaid in full and terminated its $225 million Term Loan B credit facility due May 2013.  The consent solicitation launched in connection with the repurchase of the Company's 2012, 2014 and 2015 notes was also successful, resulting in the modification or elimination of substantially all of the restrictive covenants contained in the supplemental indentures governing each series of notes.  

As a result of the repayment in full of the Term Loan B credit facility and the repurchase of 89% of the 2012, 2014 and 2015 senior notes, the Company has reduced the principal amount of its indebtedness maturing prior to September 2016 from approximately $665 million to $89 million.  The Company expects to incur cash charges from the early extinguishment of debt of approximately $22 million during the 2010 fourth quarter, consisting of premiums, consent fees and other expenses related to the debt repayments, as well as a non-cash charge of approximately $2 million related to the write-off of deferred debt costs.  The $24.5 million cost associated with the early unwind of the Company's interest rate swap related to the Term Loan B will be amortized over a period of approximately 2.3 years.

Warrant Exercise

As previously announced, on November 23, 2010 the Company and MP CA Homes LLC amended the warrant to purchase the Company's Series B Preferred Stock held by MP CA Homes LLC. The original warrant, which was issued on June 27, 2008 in exchange for the extinguishment of $128.5 million of the Company's indebtedness, was amended to, among other things, make it mandatorily exercisable for cash no later than the business day immediately following the Company's consummation of cash tender offers for its 2012, 2014 and 2015 senior notes.  In connection with the successful completion of the tender offers, on December 21, 2010 MP CA Homes LLC exercised the warrant for the exercise price of $187.5 million in cash and was issued 89.4 million shares of the Company's common stock.  As a result of this transaction, the warrant, which an independent third party determined had a value of approximately $132 million immediately prior to its amendment, was extinguished.

Ken Campbell, Standard Pacific Home's Chief Executive Officer, noted, "The successful completion of our debt refinancing eliminated all but approximately $89 million of our pre-September 2016 debt maturities.  The elimination of these debt maturities, coupled with the proceeds of the warrant exercise, makes available a substantial amount of additional capital for use in the execution of our strategy of pursuing land acquisitions during the extended market downturn."  

About Standard Pacific Corp.

Standard Pacific, one of the nation's largest homebuilders, has built more than 112,000 homes during its 44-year history.  The Company constructs homes within a wide range of price and size targeting a broad range of homebuyers.  Standard Pacific operates in many of the largest housing markets in the country with operations in major metropolitan areas in California, Florida, Arizona, the Carolinas, Texas, Colorado and Nevada.  For more information about the Company and its new home developments, please visit our website at: www.standardpacifichomes.com.

Forward-Looking Statements

This press release contains forward-looking statements, including our statements regarding the amount of expected loss that will be incurred in connection with our debt repayments, the availability of capital to be used to purchase land, and our intended land acquisition strategy.  All forward-looking statements in this press release reflect the Company's current analysis of existing facts and information and represent the Company's judgment only as of the date of this press release.  Actual events or results might differ materially from these statements due to risks and uncertainties. The Company expressly disclaims any intent or obligation to update these forward-looking statements, except as required by law.  For a discussion of certain of the risks, uncertainties and other factors affecting the statements contained in this press release, see the Company's Annual Report on Form 10-K for the year ended December 31, 2009 and subsequent Quarterly Reports on Form 10-Q.

SOURCE Standard Pacific Corp.